For a foreign subsidiary that uses the U.S. dollar as its functional currency, what method is required to ready the financial statements for consolidation?
A) Current/Noncurrent Method.
B) Monetary/Nonmonetary Method.
C) Current Rate Method.
D) Temporal Method.
E) Indirect Method.

Question

Quizplus · Accepted Answer

The Temporal Method is used when the functional currency is the same as the parent company's currency, which in this case is the U.S. dollar. This method remeasures the subsidiary's financial statements into the parent company's currency.

For a Foreign Subsidiary That Uses the U